GitLab is cutting staff and killing its CREDIT values. The CEO calls it 'Act 2.'

GitLab CEO Bill Staples published a company-wide letter on May 11 titled “GitLab Act 2.” It announces a workforce reduction, retires the company’s core values framework, and frames every change as preparation for what Staples calls “the agentic era.”

He didn’t say how many people are losing their jobs. That detail, along with the financial impact, won’t arrive until the June 2 earnings call. What he did say: GitLab is cutting its country footprint by up to 30%, removing up to three layers of management in some functions, and reorganizing R&D into roughly 60 smaller teams. Employees can volunteer for separation through May 18.

What’s actually changing

GitLab had 2,580 employees as of January. The company operates in nearly 60 countries, a remnant of its “all-remote” DNA from co-founder Sid Sijbrandij’s era. Staples wants to shrink that by roughly a third, consolidating to countries where GitLab has meaningful teams rather than one or two people.

The management flattening is blunt. “Eight layers is too deep for a company our size,” Staples wrote, “and management layers are slowing us down.” The R&D reorg nearly doubles the number of independent teams, each owning a product surface end-to-end.

Staples’ strategic thesis boils down to one sentence: “Software will be built by machines, directed by people. AI is the substrate on which future software gets built.” He outlined five architectural bets, including reengineering Git itself for agent-rate workloads and turning CI/CD into an orchestration layer for autonomous agents.

The CREDIT retirement

The bigger cultural signal is what GitLab is throwing away. Since 2014, the company’s identity revolved around its CREDIT values: Collaboration, Results, Efficiency, Diversity Inclusion & Belonging, Iteration, and Transparency. They’re gone, replaced by three operating principles: Speed with Quality, Ownership Mindset, and Customer Outcomes.

Removing Diversity as a standalone value drew the most pointed commentary on Hacker News, where the post hit 481 points. Staples embedded diversity language under a new “interpersonal excellence” pillar rather than keeping it top-level. One HN commenter summarized the shift as: “work harder, not smarter, and no more DEI.” Staples’ own framing: “We are not retiring them because they were wrong. We are choosing instead to focus on something different for this era.”

The financial backdrop

GitLab crossed $1 billion in annual recurring revenue in FY2026. Revenue hit $955 million (up 26%), free cash flow was $220 million, and gross margins sat at 87%. On paper, the business is healthy.

The stock tells a different story. GitLab shares have fallen roughly 50% over the past 12 months, from about $52 to roughly $24. Bank of America downgraded the stock to Neutral in April, citing “elevated AI competition risks.” The market appears to view agentic AI as a threat to GitLab’s DevOps platform, not the tailwind Staples is describing.

Simon Willison noted the tension in his analysis: “If your entire business depends on software engineering growing, you have a strong incentive to believe that agents will have that effect.” He found the strategic argument for agent-driven software demand compelling in principle, but cautioned that the stock decline suggests investors aren’t buying the growth story.

What this means for you

If you’re on GitLab, the platform isn’t going anywhere. The company reaffirmed FY2027 guidance and is investing in Duo Agent Platform, which went GA in January. But reduced headcount means fewer people maintaining docs, reviewing community MRs, and responding on forums.

The top HN comment captured the competitive irony: GitHub has been plagued by documented outages for months (the reason Mitchell Hashimoto pulled Ghostty off the platform). “The ball is right there, bouncing alone in front of the goal,” the commenter wrote. Instead of positioning as the stable alternative, GitLab is chasing the same AI narrative as everyone else. Whether that’s the right bet depends on whether you think agentic DevOps is a real market or a rebranding exercise. The June 2 earnings call will at least tell us the price tag.